A previous comment explained these three contributors to in-house workload (See my post of Nov. 24, 2007.). Assuming these witches are in fact riding the skies, why is it that the median number of lawyers per billion dollars of revenue has barely changed in the past 10 years (See my posts of Dec. 5, 2007 about the steadiness of key benchmarks over 14 years.)? Several explanations come to mind.
1. Lawyers in-house, together with their outside counselors, have become more capable, more productive, or both. The quality of both in-house lawyers and outside counsel have increased, since US law schools have not opened up more seats but there has been more competition for those seats. Further, many excellent lawyers have left firms to go in-house. Part of the improvement, I suspect, has been the dramatic rise in the number of in-house lawyers who are female (See my post of Nov. 10, 2007 on gender differences and references cited.).
2. Somewhat paradoxically, new laws, regulations, patterns of practice, or court decisions sometimes clarify an area of law and reduce complexity (See my post of Feb. 16, 2006 about tax code elaboration.).
3. All the time, lawyers inside and outside strive to standardize legal practices and thereby keep pace with complexity (See my post of Sept. 13, 2006 on commodity legal services and references cited.).
4. Management practices inside law departments have improved, such as alignment with business units and hiving off quasi-legal work (See my post of July 21, 2005 and my article on quasi-legal tasks that it cites.). Some work that was previously done or done more thoroughly has fallen by the wayside, a victim of higher-priority legal needs.
5. Outside law firms may log more hours so they have picked up some of the additional workload (See my post of Nov. 2, 2006 about percentages of firms that set 2,000 associate hours as the goal to bill.).
6. At bottom, a contract for $1 million may be no easier than a contract for $2 million (in today’s dollars). (See my post of Dec. 31, 2006 on how to adjust for inflation.).